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'The US is strongly placed to expand its crude supplies to India.'
Petroleum and Natural Gas Minister Hardeep Singh Puri stressed there is a possibility of more energy exports from the United States heading to India.
This comes even as the new Donald Trump administration announced plans to maximise oil and gas production.
"The number of India's oil suppliers has already gone up from 27 to 39 and if more oil comes in, this is something that we welcome," Puri said on the sidelines of an auto industry event in New Delhi.
On January 21, 2025, Trump declared a national energy emergency, which will give him broad powers to reduce environmental restrictions on energy infrastructure and projects.
It will ease permits on new transmission and pipeline infrastructure.
He also signed an executive order allowing the US government to resume processing export permit applications for new liquefied natural gas (LNG) projects.
A long-time supporter of fracking and higher crude production, Trump has indicated he wants to raise US oil exports to record levels, and use it to pay off national debt.
Trump's win is being seen as a net positive for India's energy security, and crude oil import scenario by petroleum ministry officials.
Inbound crude volumes from the US may spike from April onwards as the Trump administration removes barriers to export, and authorises natural gas quotas, officials said.
US shale oil would act as an alternative to India's heavy dependency on Russian crude, which is currently facing sanctions, they said.
"The US is strongly placed to expand its crude supplies to India. Despite the Joe Biden administration's focus on transitioning to cleaner fuels, the US remained the fifth largest source of crude for India for two straight years, dropping a position since FY22," an official said.
The US was the fifth-largest source of crude for India in the first eight months of 2024-2025, according to commerce department data.
Asian buyers of US oil are set to witness significant opportunities to import attractively-priced crude from the US, analysts said.
America's domestic production has continued to grow rapidly while competition with Organization of the Petroleum Exporting Countries (Opec) suppliers has intensified.
"With growth in US crude production and exports, the US will continue to compete with Opec exporters in Asia. It is targeting European refiners and developing new markets in Africa and Latin America," said Benjamin Tang, head of liquid bulk at S&P Global Commodities at Sea.
Import of liquefied natural gas (LNG) from the US may also rise.
In January, last year, the Biden administration had announced a temporary pause on pending decisions on exports of LNG to nations with which it doesn't have a free-trade agreement (FTA).
India does not have an FTA with the US.
The US is the largest LNG exporter worldwide, with shipments expected to double by the end of this decade.
Data from the US Energy Information Administration (EIA) shows that LNG shipments to India began rising fast from early-2020 after Covid struck globally.
Monthly traded volumes had risen to a high of 28,259 million cubic feet in May 2021, before falling.
Volumes had stood at 13,698 million cubic feet as of October, 2023, after which the EIA discontinued publishing monthly data.
Sanctions on Russia
Discussions on a term deal for crude oil purchase from Russia had come to a halt in the wake of the latest sanctions on Russia, petroleum ministry sources told Business Standard last week.
A joint front of State-owned refiners was discussing crude oil purchase from Russia under a term deal.
Crude oil from Russia is usually purchased on spot prices, while long-term contracts are usually reserved for crude from India's traditional import sources in West Asia.
Spot purchase allows refineries to secure different grades of oil, otherwise unavailable.
But sanctions on Russian oil and gas entities by the US earlier this month, has put the talks on hold.
Feature Presentation: Aslam Hunani/Rediff.com
